Change of driver for Auto Trader

“The better-than-expected US growth reported at the end of last week sets the scene for a positive start to the new week for UK stocks," says Russ Mould, Investment Director at AJ Bell.

“The FTSE 100 is up modestly ahead of a busy week which is also dominated by events across the Atlantic, with Google-owner Alphabet set to report later today, the US Federal Reserve set to decide on interest rates and the latest phase in trade talks between the US and China.”

Auto Trader

“News that Auto Trader chief executive Trevor Mather is to step down next March is a blow for shareholders in the car listings site.

“In post for nearly six years, Mather helped lead the company through the IPO process and has done a good job of running it as a public company.

“It has not always been the smoothest drive but more recently the company and its shares have been really motoring, with the company joining the ranks of the FTSE 100 at the end of 2018.

“Despite being in existence in one form or another since 1977, Mather has helped turn Auto Trader into a truly ‘new media’ company. The slightly dog-eared looking print product for which it was famous was discontinued in 2013 leaving the group 100% digital. More than 70% of its traffic is now generated through smartphones and tablets.

“The company has a ready-made succession plan in place with finance chief and head operating man Nathan Coe stepping up to take the wheel.

“On this basis, the company’s strategy is unlikely to change. The challenge for Coe will be to continue to grow earnings in a car market which appears to be softening faster than a punctured tyre.

“Growth has been heavily driven by upselling higher value subscription-based packages to retailers. This could be more difficult to achieve if these clients are facing engine trouble.”

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